National Housing Survey Results
On Oct. 12, 2016, NeighborWorks America released highlights from its fourth annual national housing survey. Aspirations of homeownership remain strong, with 89 percent of adults saying that homeownership is an important part of the American Dream, but an increasing percentage of consumers with student loan debt worry about their homeownership future, and a large percentage of consumers say that the mortgage process is complicated.
These factors are just a few of the forces holding back the housing market from a more robust, and broad-based recovery.
The national telephone survey asked questions that examined the relationship that student loan debt burdens are having on homeownership. It found that in 2016, 30 percent of adults knew someone who delayed the purchase of a home because of their student loan debt burden, compared to 28 percent in 2015, and 24 percent in 2014. Importantly, of the people who reported that they held student loan debt, 53 percent said that the debt was “somewhat or very much” an obstacle to homeownership, a slight improvement from 57 percent in 2015, but still up from 49 percent in 2014.
The complexity of the homebuying process may be dampening enthusiasm for homeownership, despite historically low mortgage rates. Approximately 67 percent of adults said that they strongly or somewhat agreed “that the home buying process is complicated,” a slight improvement from 70 percent in 2015, but within the survey’s margin of error.
Nevertheless, homeownership remains a goal for most, and NeighborWorks America and the NeighborWorks network support a range of programs that help consumers understand the process, develop reasonable budget plans, and prepare financially for what is usually the biggest purchase most make in their lifetime.
This positive view of homeownership is more evident among minorities, the fastest growing segment of homebuyers. However, changes in intensity are within the survey’s margin of error of +/- 3.1%. Specifically, in 2016, 14 percent of African-Americans and 12 percent of Hispanics said that homeownership is the most important part of their view of the "American Dream," compared to 9 percent of whites. In 2015, 16 percent of African-Americans, 10 percent of Hispanics, and eight percent of whites said that homeownership was the most important part of the American Dream.
Overall affordability may perhaps be the most troubling sign for the housing market in the future. Only 45 percent of those surveyed believe that where they live is affordable to first-time homebuyers. Moreover, 56 percent of people believe that rent prices are too high for a person to save to buy a home in their area. This pessimism is especially strong among minorities who currently rent. Fifty-two percent of non-white renters strongly agree that rent prices where they live are too high to save for a future home.
For NeighborWorks organizations and other nonprofits that offer homeownership services, these data illustrate an opportunity to increase homeownership. By expanding homebuyer education, student loan debt management counseling, and down payment outreach initiatives, nonprofits would help people locate information that could may clear up market confusion and expand the use of tools that improve access and affordability.